Toshiba gives the final nod for the sale of its microchip business

The globally acclaimed Japanese tech conglomerate, Toshiba Corporation, has finally given the green signal for offloading its lucrative microchip unit. Reliable sources cite that the board has officially decided to sell the company’s microchip business – the Toshiba Memory Corporation, to a consortium of Japanese and American investors.

Toshiba’s decision comes on the heels of the monetary losses it has incurred from its investments in certain American nuclear power projects. The fiscal deficits incurred by the computer storage devices market giant may have prompted Toshiba to quickly leverage its business position by selling one of its most profitable divisions. In addition, predictions that Toshiba’s aims to retain a certain level of control over its chip unit has also been doing the rounds.

For the record, the microchip unit, Toshiba Memory Corporation, is a rather well-known and acclaimed producer of flash memory chips deployed in numerous digital devices across the globe. If reports are to be believed, the business is likely to be sold for a valuation of around USD 18 billion (approximately JPY 1 trillion). The structure of the sale remains quite complex, as stated by the Japanese company’s officials, and Toshiba mentioned that post the sale, it would still be retaining a certain degree of control over Toshiba Memory Corporation. Also, it is still not clear how much of the company’s stake would be exclusively owned by the Japanese and American buyers.

So far, Toshiba’s buyers are inclusive of an elite rank of investors, encompassing two major firms that fall under the jurisdiction of the Japanese government, the Development Bank of Japan, the Innovation Network Corporation of Japan, and the reputed American buyout company, Bain Capital. However, it has come to the notice that other conglomerates along the likes of SK Hynix, the South Korea based semiconductor firm and the tech mogul Apple, have also been negotiating separately with Toshiba to acquire a potentially smaller, but worthwhile stake in Toshiba Memory Corporation.

According to a spokesperson from the company, myriad other details about the sale are yet to be finalized. Experts cite that this may be subtle indication of the company leaving open certain avenues for other bidders. The ambiguity regarding the sale is also indicative of confusion, a possible degree of antipathy, and transaction turnarounds. However, an anonymous source has revealed that Toshiba most certainly has no further intentions of negotiating with any other investors regarding the proposed sale of Toshiba Memory Corporation.

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Saipriya Iyer

Saipriya Iyer develops content for Market Size Forecasters, Algosonline, and myriad other platforms. A computer engineer by profession, she ventured into the field of writing for the love of playing with words. Having had a previous experience of 3 years under her bel...

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